1099-K
Form 1099-K is the IRS information return that marketplaces and payment processors file to report your gross payment volume for the year. Gross means before refunds, fees, chargebacks and reserves, so the number is always bigger than what hit your bank. After several years of shifting thresholds, Congress restored the original trigger in 2025: more than $20,000 in payments and more than 200 transactions. Established sellers get one from every platform they sell on.
The 1099-K matters because the IRS computer-matches it against your return. If Amazon reports $1.2 million gross and your books show the $890,000 that actually landed in the bank, that's a $310,000 gap the IRS can see. It doesn't mean you owe tax on the gap, refunds and fees are deductible, but you have to be able to reconcile it, line by line, and deposit-based books can't.
Multi-channel sellers collect a stack of these forms: one from Amazon, one from Shopify Payments, one from PayPal, one from Walmart. Each reports gross, each on its own calendar, and together they should tie to the gross revenue in your books. When they don't, the fix runs through settlement reports, not bank statements. We wrote a full breakdown in our guide to the Amazon 1099-K, and tying books to 1099-Ks is standard practice in our tax work.
Where this shows up in our work
This isn’t textbook material for us; it’s the day-to-day of keeping seller books right. See how we handle it in practice:
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